By MEGGIE I. FOSTER
Assistant Editor INDIANAPOLIS, Ind. — Now that the passage of the 2008 Farm Bill is well behind U.S. farmers, the Farm Service Agency (FSA) is actively inviting producers to take a look at the newest programs and loan offerings available from the USDA.
“I’d like to entice you to come in and look at our programs and what FSA has to offer you,” said Indiana FSA State Executive Director Julia Wickard.
During the Midwest Women in Ag Conference Feb. 24-25 in Indianapolis, Wickard, along with her colleagues Ann Eggleston, a farm loan specialist, and Gail Peas, conservation program specialist in Indiana, discussed the goals and vision of FSA, available farm loan programs and conservation programs.
Wickard explained that its important to remember the top three goals of the FSA in order to better understand the purpose and vision of the agency. No. 1, FSA supports productive farms and ranches, supports secure and affordable food and fiber, as well as helps conserve natural resources and enhances the environment.
She also mentioned that FSA works under a field delegation of authority including the state executive director, state committee, county executive director, farm loan manager and county committee.
“This is where you can get involved in your local community, through the county committee,” added Wickard.
Indiana FSA is home to 79 county offices across the state and approximately 430 employees.
Funding for the state agency is allocated through the Farm Bill at approximately 17 percent of the overall $307 billion farm bill budget, according to Wickard.
Farm loan programs When applying for a farm loan, qualified parties include farm owners or operators, small farmers, limited resource farmers and socially-disadvantaged farmers, according to Eggleston.
Eggleston explained that there are two types of farm loans: direct loans and guaranteed loans. Direct loans may be used to finance crop inputs, purchase equipment and livestock, purchase or improve real estate and refinance non-FSA debts.
While on the other hand, guaranteed loan types may be used as a: term operating loan with an up to seven-year repayment term; an operating line of credit with an up to five-year revolving term; an operating loan interest assistance with a 4 percent interest rate subsidy available in some cases; or a farm ownership loan, where terms are based on what the bank will allow.
“Guaranteed loans are used for the same purpose as direct loans, where you obtain the funds from the bank, the government guarantees it as a small business administration loan,” said Eggleston.
“This type of loan helps producers out who may be having a hard time getting a loan on their own.”
Generally, the loan limit on a guaranteed loan is $1.112 million, according to Eggleston, who added that the loan limit is adjusted every year around the first of October.
Again, most often, guaranteed loans are used to finance crop inputs, purchase equipment, livestock, purchase or improve real estate or refinance FSA or non-FSA debts.
Another popular loan program through FSA is the beginning farmer loan, where young farmers may seek favorable loan rates on farm ownership purchases or for operating loans.
Guidelines under the beginning farmer program specify that the applicant must not have farmed for more than 10 years and cannot own more than 30 percent of the median-sized farm in the county (to qualify for a farm ownership loan).
Eggleston explained that farmers may also take advantage of FSA offerings through the farm storage facility loan program.
“This is getting to be very popular now that everyone wants to store grain,” she said, explaining that this opportunity also helps producers hoping to fund eligible structures that may include hay/biomass structures and refrigeration storage for fruit and vegetables, in addition to the traditional grain storage structure.
Under this program, applicants may apply for a loan amount up to $500,000 under a 7-, 10- or 12-year term depending on the loan amount.
Conservation programs According to Peas, the recent U.S. Farm Bill has provided many new opportunities for farmers in Indiana to take advantage of dollars dedicated specifically for conservation enhancement. New initiatives incorporate conservation-based resources such as biomass and carbon.
A popular stronghold under FSA’s conservation programs though, has been the Conservation Reserve Program (CRP) that began in 1985, and today serves as the nation’s largest federally funded conservation program.
All 92 Indiana counties participate in the CRP program with more than 272,000 acres enrolled (approximately 20,000 farms).
“Last year, we administered over $43,000 in CRP funds, alone,” added Peas.
Eligible landowners can apply for CRP payments under the general CRP sign-up or the continuous CRP sign-up. While the general sign-up is a competitive bidding process that occurs at periods declared by the U.S. secretary of agriculture; the continuous sign-up serves as more of a stewardship program; and also includes two other conservation initiatives: Sustainable Agriculture Research and Education (SARE) and the Conservation Reserve Enhancement Program (CREP). Conservation practices observed under CRP include: filter strips, riparian buffers, grassed waterways, field windbreaks, wetland development, habitat buffers for wildlife and upland birds and tree plantings.
Eligibility requirements for CRP specify that the ground must be cropland, have a cropping history and must have an erosion index of 8 or more unless the land is located in a state or national priority area.
According to Peas, the payment structure of the general CRP sign-up can be very lucrative for many landowners as they receive 50 percent cost-share and an annual rental payment. Additionally, continuous CRP participants receive a 20 percent annual rental payment incentive on certain practices, 40 percent practice incentive payment on certain practices and a signing incentive payment ($100/acre).
Another popular conservation program among Hoosiers is CREP, that utilizes federal, state and private resources to offer even larger incentive rates and payments for establishing conservation practices in targeted environmental areas.
Eligible CREP practices may include: filter strips, riparian buffers, wetlands and tree establishment within the flood plain.
“Basically CREP is CRP on steroids, where the federal government puts in money, the state contributes to that fund and makes it extra beneficial,” explained Peas.
Producers enrolled in CREP receive all the benefits of continuous CRP, plus a 40 percent annual rental rate and the state of Indiana also provides an additional one-time inventive ranging from $100-$400 per acre.
For a map of cu
rrent and proposed CREP watersheds in Indiana, contact the FSA office at 317-290-3030 or go online at www.fsa.usda.gov and search for Indiana. |
